LEASE AGREEMENT
THIS Lease Agreement ("Lease") is made this 12th day of July, 1999 between
HARVARD PROPERTY (333 XXX HOUSTON) L.P. called "Landlord", and Air Nexus,
Inc. hereinafter called "Tenant".
LEASE OF PREMISES
In consideration of the mutual covenants herein, Landlord hereby leases to
Tenant and Tenant hereby hires from Landlord, subject to all of the terms and
conditions hereinafter set forth, those certain premises (hereinafter called
the "Premises") set forth in Items 1 and 2 of the Basic Lease Provisions and
shown on the drawings attached hereto and made a part hereof as "Exhibit
A-1". The office building in which the Premises are located, the land on
which the office building is situated (described in the attached "Exhibit
A-2"), and all improvements and appurtenances to the building and the land,
are referred to collectively herein as the "Building".
BASIC LEASE PROVISIONS
The following provisions set forth various basic terms of this Lease and are
sometimes referred to as the "Basic Lease Provisions".
1. Building: 000 Xxxxx Xxxx
Address: 000 X. Xxx Xxxxxxx Xxxxxxx X., Xxxxxxx, Xxxxx
2. Floor(s): 8th
Suite(s): 870
Net Rentable Area: 4,199 RSF
3. a. Total Net Rentable Area of Building: 205,645
b. Tenant's Building Expense Percentage 0.0200296
c. Base Year: 1999
4. a. Basic Rent Square Foot
1st Year $16.00
2nd Year $16.50
3rd Year $17.00
4th Year $17.50
5th Year $18.00
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b. Basic Monthly Rent:
1st Year $5,492.00
2nd Year $5,663.63
3rd Year $5,835.25
4th Year $6,006.88
5th Year $6,178.50
c. Basic Yearly Rent Rent:
1st Year $65,904.00
2nd Year $67,963.50
3rd Year $70,023.00
4th Year $72,082.50
5th Year $74,142.00
5. Term: 5 Years
6. Target Commencement Date: October 1, 1999
7. Security Deposit: $5,492
8. Brokers: X.X. Xxxxxxxxx & Company, Inc.
Address: 0000 Xxxxxxx, Xxxxx 00000
Xxxxxxx, Xxxxx 00000
9. Addresses for notices due under this Lease:
Tenant:
Air Nexus, Inc.
000 X. Xxx Xxxxxxx Xxxxxxx X.
Xxxxx 000
Xxxxxxx, Xxxxx 00000
Landlord:
Harvard Property (333 Xxx Houston) L.P.
000 X. Xxx Xxxxxxx Xxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Special Provisions:
10. Tenant, at Tenant's sole expense has the right to install a small
satellite dish on the building roof provided that no additional electricity
is needed. In the event additional electricity is needed, Tenant, at
Tenant's sole cost and expense will install a sub-meter that will be read
by the building engineers on a monthly basis. The additional cost of
electricity will be billed back to the Tenant.
11. Landlord has received written notice from the Tenant that X.X.
Xxxxxxxxx & Company is to represent Air Nexus, Inc. in this transaction.
Landlord agrees to pay a four (4%) commission divided into two equal
payments. The first payment will be considered earned and due within ten
(10) days after the execution of the lease or other agreement including
extension of lease, renewal, or expansion of the Premises. The second
payment will be earned and due ten (10) days after Tenant occupies the
Premises.
12. Lessee shall have the option to renew the lease for one additional five
(5) year period provided that Tenant provide Landlord with a one hundred
and eighty (180) day written notice of the Tenant's intent to renew. If
the Option to Renew is exercised, the Base Rent during the Option Term
shall be ninety-five percent rate (95%) of the then prevailing market
rental.
13. Effective October 1, 1999, provided that Tenant is not in default of the
Lease, remains financially responsible, and subject to all the terms and
conditions provided by the Lease, all Amendments or Modifications made
to the Lease; Tenant shall have a one time First Right of Refusal on any
space as it becomes available on the eighth (8th) floor subject to any
existing options or First Right of Refusals. If any such space has an
offer made by a Prospective Tenant that is included in the First Right
of Refusal on the eighth, Landlord shall propose that same offer to
Tenant and Tenant shall be given a one time First Right of Refusal.
Landlord shall notify Tenant in writing either by a hand delivered copy
that is signed with a receipt date or by certified, return receipt
requested mail. Tenant shall have the responsibility to respond in
writing to Landlord within five (5) business days thereafter. If Tenant
fails to respond or responds that it does not wish to exercise its Right
of First Refusal, the Landlord shall have the right to lease the space
stated in Tenant's notice to said third party.
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14. Landlord agrees to allow Tenant a one-time Cancellation Option at the
end of thirty-six (36) months in the event Landlord is unable to provide
expansion space with the following provisions:
a. Tenant is willing to execute a binding agreement,
b. Tenant will expand the Premises then under lease by more than
twenty-five percent (25%), at the then market rate, within ninety
days of written notice.
c. In the event Tenant elects to cancel the Lease, Tenant will be
required to reimburse Landlord for all unamortized costs Landlord
funded for leasehold improvements costs, leasing commissions and
architectural fees.
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15. TABLE OF CONTENTS
Description
Article 1 - Term and Possession
Article 2 - Rent
Article 3 - Security Deposit
Article 4 - Occupancy and Use
Article 5 - Utilities and Service
Article 6 - Repairs, Maintenance, Alterations and Improvements
Article 7 - Insurance, Fire and Casualty
Article 8 - Condemnation
Article 9 - Liens
Article 10 - Taxes on Tenant's Property
Article 11 - Subletting and Assigning
Article 12 - Transfers by Landlord
Article 13 - Default
Article 14 - Notices
Article 15 - Miscellaneous Provisions
Guaranty
Exhibit A-1 - Floor Plan
Exhibit A-2 - Description of Land
Exhibit B - Area Definitions
Exhibit C - Acceptance of Premises Memorandum
Exhibit D - Agreement for Construction
Exhibit E - Rules and Regulations
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ARTICLE 1
TERM AND POSSESSION
Section 1.01. Commencement and Expiration. The Term of this Lease shall be
the period of time specified in Item 5 of the Basic Lease Provisions,
adjusted as provided below. Subject to and upon the terms and conditions set
forth herein or in any Exhibit or Addendum hereto, the Term shall commence on
the Target Commencement Date shown in Item 6 of the Basic Lease Provisions,
or such earlier date as Tenant takes possession or commences use of the
Premises for any purpose. The Term of this Lease shall expire, without notice
to Tenant, on the Expiration Date. If the Lease commences on any day other
than the first day of a calendar month, the term of the Lease shall be
extended by that part of one month necessary to cause the expiration of the
term to be on the last day of a calendar month. The dates of commencement
("Commencement Date") and expiration ("Expiration Date"), shall be confirmed
by Landlord and Tenant by execution of an "Acceptance of Premises Memorandum"
in the form attached hereto as "Exhibit C" and made a part hereof.
Section 1.02. Acceptance of Premises. The taking of possession of the
Premises by Tenant shall be conclusive evidence against Tenant that, except
for the completion of the remaining items of Landlord's work, if any, which
are to be done pursuant to Exhibit D, and for minor "punch list" items agreed
to in writing by Landlord and Tenant, which Landlord will promptly remedy,
(i) the Premises are suitable for the purpose for which the same are leased,
(ii) the Building and each and every part and appurtenance thereof are in
good and satisfactory condition, and (iii) Tenant waives any defects in the
Premises and its appurtenances and in all other parts of the Building and the
appurtenances thereto. Upon delivery of possession of the Premises to Tenant,
Landlord and Tenant shall execute the above-mentioned Acceptance of Premises
Memorandum, although Tenant shall be deemed to have accepted the Premises
even though the Acceptance of Premises Memorandum may not have been executed.
Section 1.03. Surrender of the Premises. Upon the expiration or earlier
termination of this Lease, or upon the exercise by Landlord of its right to
re-enter the Premises without terminating this Lease, Tenant shall
immediately surrender to Landlord the Premises and all keys to the Premises
and all parking and Building access cards, together with all alterations,
improvements and other property as provided elsewhere herein, in good order,
condition and repair, except for ordinary wear and tear; provided that at
Landlord's written request Tenant shall remove at its expense improvements to
the Premises such as special wall coverings and flooring which have become a
part of and otherwise would have remained with the Premises. Tenant shall, at
its expense, promptly repair any damage caused by removal of any improvements
requested by Landlord as aforesaid, and shall restore the Premises to the
condition existing prior to the installation of the items removed. If Tenant
fails to surrender the Premises in the condition aforesaid, then Landlord may
restore the Premises to such a condition at Tenant's expense. Upon the
expiration or earlier termination of the Lease, Tenant will, at the option of
Landlord, execute a Release of Lease and Waiver of Claim, in recordable form,
containing Tenant's release of all of its interest in the Premises, which
Release of Lease shall not be necessary to effectuate such release.
Section 1.04. Holding Over. In the event Tenant, or any party claiming
under Tenant, retains possession of the Premises after the expiration or
earlier termination of this Lease, such possession shall be an unlawful
detainment, and no tenancy or interest shall result from such possession;
such parties shall be subject to immediate eviction and removal, and Tenant
or any such party shall pay Landlord as rent for the period of such hold-over
an amount equal to one and one half times the Basic Rent payable during the
last Lease Year of the Term. Tenant shall also pay any and all damages
sustained by Landlord as a result of such hold-over. Tenant will vacate the
Premises and deliver same to Landlord immediately upon Tenant's receipt of
notice from Landlord to so vacate. The rent during such hold-over period
shall be payable to Landlord on demand. No holding over by Tenant, whether
with or without consent of Landlord, shall operate to extend this Lease.
ARTICLE 2
RENT
Section 2.01. Basic Rent. Tenant agrees to pay as Basic Rent for the
Premises for each Lease Year the sum shown in Item 4 of the Basic Lease
Provisions as "Basic Yearly Rent." The Basic Rent shall be payable in equal
monthly installments in the amount set forth in Item 4 of the Basic Lease
Provisions as "Basic Monthly Rent" in advance, without demand, counterclaim,
deduction, or set off, commencing on the Commencement Date (subject to the
provisions of Section 2.02 D. hereof) and continuing on the first day of each
calendar month thereafter. (For purposes hereof, the first "Lease Year" shall
be the period beginning on the Commencement Date and ending on the last day
of the calendar month in which the first anniversary of the Commencement Date
occurs; each subsequent Lease Year shall be the 12 month period commencing on
the last day of the immediately preceding Lease Year, except that the last
Lease Year shall end on the last day of the Term). The Basic Rent shall be
adjusted in the case of any Lease Year which has more than or less than 365
days. If the Term of this Lease commences on a day other than the first day
of a calendar month, the rent for such partial month shall be prorated in the
proportion that the number of days this Lease is in effect during such
partial month bears to the number of days in that calendar month.
Section 2.02. Additional Rent.
A. Definitions. For purposes of this Section 2.02, the following
definitions shall apply:
1. "Additional Rent" shall mean the amount of Tenant's
Proportionate Share of Building Operating Expenses for a
particular calendar year, or portion thereof in excess of
Building Operating Expenses for the Base Year.
2. "Building Operating Expenses" shall mean all of Landlord's
direct costs and expenses paid or incurred in operating and
maintaining the Building for a particular calendar year or
portion thereof as determined by Landlord in accordance with
generally accepted accounting principles, including all
additional direct costs and expenses of operation and
maintenance of the Building which Landlord determines that it
would have paid or incurred during such year if the Building
had been ninety-five (95%) occupied. Building Operating
Expenses shall include by way of illustration but not
limitation: all general real estate taxes and all special
assessments; costs and expenses of contesting the validity or
amount of real estate taxes; insurance premiums; water,
sewer, electrical and other utility charges; service and
other charges incurred in the operation and maintenance of
the elevators and the heating, ventilation and air-conditioning
system; cleaning and other janitorial services; tools and
supplies; repair costs; landscape maintenance costs; security
services; license, permit and inspection fees; reasonable
management fees; wages and related benefits payable to
employees directly engaged in the maintenance and operation
of the Building, including taxes and insurance relating
thereto; accounting services; trash removal; garage
maintenance and operating costs; and, in general, all other
costs and expenses which would generally be regarded as
operating and maintenance costs and expenses, including those
which would normally be amortized over a period not to exceed
five (5) years. There shall also be included in Building
Operating Expenses the cost of any capital improvement made
to the Building by Landlord after the date of this Lease
which is required under any governmental law or regulation
that was not applicable to the Building at the time it was
constructed, amortized over such period as Landlord shall
reasonably determine, together with an amount equal to
interest at the rate of 12% per annum on the unamortized
balance.
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In addition to inclusion of the cost of any capital
improvement required by any governmental law or regulation as
aforesaid, if Landlord shall install a labor-saving device or
other equipment which improves the operating efficiency of
any system within the Building, then Landlord may add to
Building Operating Expenses in each year during the useful
life of such installed device or equipment an amount equal to
the annual amortization allowance of the cost of such
installed device or equipment as determined in accordance
with applicable regulations of the Internal Revenue Service
or generally accepted accounting principles, together with an
amount equal to interest at the rate of 12% per annum on the
unamortized balance thereof.
For the purpose of this Article, payments made by tenants
of the Building, either to third parties or to Landlord,
under agreements for direct reimbursement for services (e.g.,
separately metered utilities, separately contracted
janitorial services, property taxes directly reimbursed to
Landlord, etc) shall not be included in "Building Operating
Expenses". However, for each category of expense for which
one or more tenants of the Building makes such payments,
Tenant's Building Expense Percentage shall be adjusted by
excluding from the denominator thereof the Net Rentable Area
of all tenants making such payments (for instance, if tenants
leasing a total of 10% of the Net Rentable Area of the Building
pay their own electricity bills under an arrangement for
separate metering, the Building Expense Percentage for each
tenant not making such payment will increase proportionately
with respect to that category of expense).
If Tenant makes any such payment, Building Operating
Expenses, for purposes of this Article, shall exclude the
category of expense for which such payment is made, but only
to the extent that the category of expense includes payments
made or charges incurred with respect to space actually
leased to other tenants (for example, if Tenant pays its own
electricity, Building Operating Expenses for purposes of
determining Tenant's Additional Rent shall include the
electricity expense associated with space not actually leased
to other tenants).
3. "Building Expense Percentage" shall mean the percentage
specified in Item 3 of the Basic Lease Provisions. This
percentage was determined by dividing Net Rentable Area in
the Premises, as specified in Item 2 of the Basic Lease
Provisions, by the total Net Rentable Area in the Building.
4. "Tenant's Proportionate Share of Building Operating Expenses"
shall be the dollar amount equal to the product of Tenant's
Building Expense Percentage times the Building Operating
Expenses.
5. "Base Year" shall mean the twelve (12) month period specified
in Item 3 of the Basis Lease Provisions.
B. Payment Obligation. In addition to the Basic Rent specified in this
Lease, Tenant agrees to pay to Landlord as Additional Rent for the Premises,
in each calendar year or partial calendar year during the Term of this Lease,
an amount equal to Tenant's Proportionate Share of Building Operating
Expenses for such calendar year in excess of Building Operating Expenses
during the Base Year.
1. Payment of Tenant's Proportionate Share of Building Operating
Expenses. Tenant's Proportionate Share of Building Operating
Expenses in excess of Building Operating Expenses during the
Base Year for the remainder of the calendar year after the
Commencement Date and for each subsequent calendar year shall
be estimated by Landlord, and such estimate may be revised
from time to time, and written notice thereof shall be given
to Tenant. For the calendar year in which the Commencement
Date occurs, Tenant shall pay to Landlord each month, at the
same time the Basic Rent is due, an amount equal to the
amount of such estimated Additional Rent for the remainder of
such calendar year divided by the number of months remaining
in such year; and for each calendar year thereafter Tenant
shall pay to Landlord each month, at the same time the Basic
Rent is due, an amount equal to one-twelfth (1/12) of the
estimated annual Additional Rent due.
2. Revisions in Estimated Additional Rent. If Landlord revises
the estimated Additional Rent during any calendar year,
thereafter Tenant, following written notice to that effect,
shall pay to Landlord, in each of the remaining months of
such year, an additional amount equal to the amount of such
increase in the estimated Additional Rent divided by the
number of months remaining in such year.
3. Adjustments to Actual Additional Rent. After the end of each
calendar year, Landlord shall prepare and deliver to Tenant a
statement showing Tenant's actual Additional Rent. Within
thirty (30) days after receipt of the aforementioned
statement, Tenant shall pay to Landlord, or Landlord shall
credit against the next Additional Rent payment or payments
due from Tenant, as the case may be, the difference between
Tenant's actual Additional Rent for the preceding calendar
year and the estimated Additional Rent paid by Tenant during
such year.
C. Rent. The Basic Rent, the Additional Rent, and all other sums
required to be paid by Tenant hereunder, including any sums due under the
Agreement for Construction, are sometimes collectively referred to as, and
shall constitute, "Rent".
Tenant agrees to pay Rent when due, without prior demand therefor and without
deduction or setoff unless otherwise specifically provided herein, at the
office of the Building Manager or at such other place as Landlord may
designate.
In the event any installment of Rent under this Lease shall not be paid by
the fifth day of the calendar month, a "Late Charge" of five percent (5%) so
overdue may be charged by Landlord as additional rent and also for the
purpose of defraying Landlord's administrative expenses incident to the
handling of such overdue payments; and Tenant agrees to pay such Late Charge
to Landlord on demand therefor.
D. First Month's Rent. Tenant agrees to deposit with Landlord, upon
execution of this Lease, a sum equal to one full month's installment of
Basic Rent, which shall be credited to the first installment of Basic Rent
due hereunder.
ARTICLE 3
SECURITY DEPOSIT
Tenant will pay Landlord simultaneously with its execution hereof the sum set
forth in Item 7 of the Basic Lease Provisions as security for the performance
of the terms hereof by Tenant. Tenant shall not be entitled to interest
thereon. If Tenant defaults with respect to any provision of this Lease,
Landlord may, but shall not be required to, use, apply or retain all or any
part of this security deposit for the payment of any rent or any other sum
in default, or for the payment of any other amount which Landlord may spend
or become obligated to spend by reason of Tenant's default, or to compensate
Landlord for any other loss or damage which Landlord may suffer by reason of
Tenant's default, including, without limitation, costs and attorney's fees
incurred by Landlord to recover possession of the Premises. If any portion of
said deposit is so used or applied, Tenant shall, upon demand therefor,
deposit cash with Landlord in an amount sufficient to restore the security
deposit to its original amount and Tenant's
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failure to do so shall constitute a default hereunder by Tenant. Tenant must
provide Landlord written notice thirty (30) days prior to vacating the
Premises. If Tenant defaults in providing Landlord with prior written notice,
Tenant shall forfeit security deposit. If Tenant shall fully and faithfully
perform every provision of this Lease to be performed by it, the security
deposit shall be returned to Tenant within thirty (30) days after the
Expiration Date.
ARTICLE 4
OCCUPANCY AND USE
Section 4.01. Use of Premises. The Premises shall be used solely for general
office purposes and for no other use. Tenant will not use, occupy or permit
the use or occupancy of the Premises for any purpose which is, directly or
indirectly, forbidden by law, ordinance or governmental or municipal
regulation or order, or which may be dangerous to life, limb or property; or
permit the maintenance of any public or private nuisance; or do or permit
any other thing which may disturb the quiet enjoyment of any other tenant of
the Building; or keep any substance or carry on or permit any operation which
might emit offensive odors or conditions into other portions of the Building;
or use any apparatus which might make undue noise or set up vibrations in the
Building; or permit anything to be done which would increase the fire and
extended coverage insurance rate on the Building or contents, and if there is
any increase in such rate by reason of acts of Tenant, then Tenant agrees to
pay such increase promptly upon demand therefor by Landlord. Payment by
Tenant of any such rate increase shall not be a waiver of Tenant's duty to
comply herewith.
Section 4.02. Rules and Regulations. Landlord's reasonable rules and
regulations applying to all tenants in the Building, shown on Exhibit E
attached hereto, and all future reasonable rules and regulations as may be
adopted by Landlord for the safety, care and cleanliness of, and preservation
of good order in, the Premises and the Building, are hereby made a part
hereof and Tenant agrees to comply with all such rules and regulations.
Landlord shall have the right at all times to change such rules and
regulations or to amend them in any reasonable manner. All changes and
amendments will be sent by Landlord to Tenant in writing and shall be
thereafter carried out and observed by Tenant.
Section 4.03. Signs. Tenant shall not inscribe, paint, affix or display any
signs, advertisements or notices on or in the Building. Landlord shall
furnish Tenant one (1) door plaque and one (1) company directory strip. All
such letters and numerals shall be in building standard graphics and no
others shall be used or permitted in the Premises.
Section 4.04. Access. Landlord or its authorized agents shall at any and all
reasonable times have the right to enter the Premises to inspect the same, to
supply janitorial service or any other service to be provided by Landlord to
Tenant hereunder, to show the Premises to prospective purchasers or tenants,
to alter, improve or repair the Premises or any other portion of the
Building, all without being deemed guilty of an eviction of Tenant and
without abatement of Rent, and may for that purpose erect scaffolding and
other necessary structures where reasonably required by the character of the
work to be performed, provided the business of Tenant shall be interfered
with as little as is reasonably practicable. Tenant hereby waives any claim
for damages for any injury or inconvenience to or interference with Tenant's
business, any loss or occupancy or quiet enjoyment of the Premises, and any
other loss occasioned thereby. For each of the aforesaid purposes, Landlord
shall at all times have and retain a key with which to unlock all of the
doors in, upon and about the Premises, excluding Tenant's vaults and safes.
Landlord shall have the right to use any and all means which Landlord may
deem proper to open any door(s) in an emergency without liability therefor.
Section 4.05. Quiet Possession. Upon Tenant's paying the Rent reserved
hereunder and observing and performing all of the covenants, conditions and
provisions on Tenant's part to be observed and performed hereunder, Tenant
shall have the quiet possession of the Premises for the entire Term hereof,
subject to all of the provisions of this Lease.
ARTICLE 5
UTILITIES AND SERVICES
Section 5.01. Services to be Provided. Provided Tenant is not in default
hereunder, Landlord agrees to furnish or cause to be furnished to the
Premises the utilities and services described below, subject to the
conditions and in accordance with the standards set forth herein:
A. Landlord shall provide passenger elevators on generally accepted
business days from 6 a.m. to 6 p.m., and on Saturdays from 8 a.m. to 1 p.m.,
and have at lease one elevator available for use at all other times.
B. On generally accepted business days from 7 a.m. to 6 p.m. and on
Saturdays from 8 a.m. to 1 p.m., Landlord shall ventilate the Premises and
furnish heat or air conditioning, at such temperatures and in such amounts as
Landlord reasonably deems standard, when, in the reasonable judgment of
Landlord, it is required for the comfortable occupancy of the Premises,
subject to any governmental requirements or standards relating to, among
other things, energy conservation. Upon at least 24 hours advance request,
Landlord shall make available at Tenant's expense after-hours heat or air
conditioning. A minimum time period for use of after hours heat and air
conditioning and the cost thereof shall be determined from time to time by
Landlord and confirmed in writing to Tenant. If Tenant has a pre-authorized
access card issued by Landlord to activate after hours heat and air
conditioning, then Landlord waives the 24 hour advance notice requirement.
Tenant with pre-authorized access card assumes all liability for use of such
card.
C. Landlord shall furnish to the Premises electric current as required by
the Building Standard office lighting and receptacles. Tenant's use of
electric current shall at no time exceed the capacity of the feeders to the
Building or the risers or wiring installation. Tenant shall not install, use
or permit any equipment of high electrical consumption, as reasonably
determined by Landlord, in the Premises without the prior written consent of
Landlord.
D. Landlord shall furnish water for drinking, cleaning and lavatory
purposes only.
E. Landlord shall provide janitorial services to the Premises, comparable
to that provided in other first class office buildings in the vicinity,
provided the Premises are used exclusively as offices.
Section 5.02. Additional Services. Landlord may impose a reasonable charge,
payable within 15 days after demand, for any utilities and services,
including without limitation, air conditioning, electric current, and water,
provided by Landlord by reason of any substantial use of the Premises at any
time other than the hours set forth above or for any use beyond what Landlord
agrees herein to furnish or because of special electrical, cooling and
ventilating needs created by Tenant's hybrid telephone equipment, computers
and other similar equipment or uses.
Section 5.03. Tenant's Obligation. Tenant agrees to cooperate fully at all
times with Landlord and to abide by all regulations and requirements which
Landlord may prescribe for the use of the above utilities and services. Any
failure to pay any excess costs as described above upon demand by Landlord
shall constitute a breach of the obligation to pay Rent under this Lease and
shall entitle the Landlord to the rights herein granted for such breach.
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Section 5.04. Service Interruption. Landlord shall not be liable for, and
Tenant shall not be entitled to, any abatement or reduction of Rent by reason
of Landlord's failure to maintain temperature or electrical constancy levels
or to furnish any of the foregoing services when such failure is caused by
force majeure, accident, emergency, breakage, repairs, strikes, lockouts or
other labor disturbance or labor dispute of any character, governmental
regulation, moratorium or other governmental action, inability by exercise of
reasonable diligence to obtain electricity, water or fuel, the making by
Landlord of repairs or changes in the Building, or by any other cause beyond
Landlord's reasonable control, nor shall any such failure, stoppage or
interruption of any such services be construed as an eviction of Tenant, or
relieve Tenant from the obligation to perform any covenant or agreement
herein. In the event of any failure, stoppage or interruption thereof,
however, Landlord shall use reasonable diligence to resume service promptly.
In the event Tenant is without utilities (electricity or water) for ten (10)
business days as a result of any occurance within the reasonable control of
Landlord, then all as a result of any occurance within the reasonable control
of Landlord, then all charges payable by Tenant to or on behalf of Landlord
pursuant to the Lease shall be abated to the extent and for the period of
such interruption.
Section 5.05. Modifications. Notwithstanding anything herein above to the
contrary, Landlord reserves the right from time to time to make reasonable
and nondiscriminatory modifications to the above standards for utilities and
services.
ARTICLE 6
REPAIRS, MAINTENANCE, ALTERATIONS AND IMPROVEMENTS
Section 6.01. Repairs and Maintenance of the Building. Landlord shall provide
for the cleaning and maintenance of the public portions of the Building.
Unless otherwise expressly stipulated herein, Landlord shall not be required
to make any improvements or repairs of any kind or character in the Premises
during the term of this Lease, except repairs to the exterior walls,
corridors, windows, roof and other structural elements and equipment of the
Building.
Section 6.02. Improvements and Alterations.
A. Landlord's sole construction obligation under this Lease, if any, is
as set forth in the Agreement for Construction attached hereto as "Exhibit D"
and incorporated herein by this reference.
B. Landlord shall have the right at any time to change the arrangement,
location and or size of entrances or passageways, doors and doorways,
corridors, elevators, stairs, toilets or other public parts of the Building
and, upon giving Tenant reasonable notice thereof, to change the name,
number, address or designation by which the Building is commonly known.
C. Tenant shall not make any alterations, additions or improvements to
the Premises without the prior written consent of Landlord, which may be
withheld in Landlord's sole discretion. All such alterations, additions or
improvements (except movable furniture and trade fixtures) shall become the
property of Landlord and shall be surrendered with the Premises, as a part
thereof, at the expiration or earlier termination of the Lease. The same
shall be made by Tenant at Tenant's sole cost and expense. Any contractor or
person making such improvements must first be approved in writing by Landlord.
Section 6.03. Landlord's Option to Repair. Landlord may, at its option and at
the cost and expense of Tenant, repair or replace any damage or injury to the
Building or any part thereof caused by Tenant, Tenant's agents, employees,
licensees, invitees or visitors. Tenant shall pay the cost thereof, which
shall include an administrative fee of 10%, to Landlord on demand. Tenant
further agrees to maintain and keep the interior of the Premises in good
repair and condition at Tenant's expense. Tenant agrees not to commit or
allow any waste or damage to be committed on any portion of the Premises.
ARTICLE 7
INSURANCE, FIRE AND CASUALTY
Section 7.01. Damage or Destruction. In the event of a fire or other casualty
in the Premises, Tenant shall immediately give Landlord notice thereof.
Except as provided to the contrary in Section 7.02 below, Landlord and
Tenant agree that if the Premises are partially or totally destroyed by fire
or other casualty, then Landlord may, at its option, repair and restore the
Premises, or Landlord may terminate this Lease. In the event that Landlord
does not elect to terminate this Lease as a result of such damage or
destruction, then Landlord, at its expense, but only to the extent of
insurance proceeds, shall repair and restore the Premises as soon as
reasonably practicable to substantially the same condition as the Premises
were prior to the casualty, provided however, that Landlord's obligation
hereunder shall be limited to the repair and restoration of such of the
improvements in the Premises as were originally required to be made by
Landlord at Landlord's expense in accordance with "Exhibit D" of this Lease.
Notwithstanding any of the foregoing provisions to the contrary, in the event
the Premises or the Building are totally destroyed or are damaged to the
extent that repairs to be made by Landlord, as estimated by a responsible
contractor selected by Landlord, cannot be substantially completed within one
hundred eighty (180) days from the date of the casualty, Landlord shall
forthwith give Tenant written notice of such estimate, and either party shall
have the right, at its option, to terminate this Lease by giving the other
party written notice of termination within seven (7) days after Tenant's
receipt of notice of said estimate from Landlord.
In the event of the Premises are totally destroyed or so damaged by fire or
other casualty covered by the fire and extended coverage insurance to be
carried by Landlord under the terms of this Lease that the Premises cannot
reasonably be used by Tenant for the purposes herein provided and this Lease
is not terminated as above set forth, then there shall be a total abatement
of Rent from the date of casualty until substantial completion of the repair
and restoration work to be performed by Landlord; and this Lease shall
continue in full force and effect for the balance of the Term. In the event
the Premises are partially destroyed or damaged by fire or other casualty so
that the Premises can be used only partially by Tenant for the purposes
herein provided and this Lease is not terminated as above set forth, then
Rent shall be abated in the proportion which the approximate area of the
damaged part bears to the total area in the Premises from the date of the
casualty until the earlier of (i) Tenant's occupancy of such area or
(ii) substantial completion of the repair and restoration work to be
performed by Landlord; and this Lease shall continue in full force and effect
for the balance of the Term.
Section 7.02 Tenant's Responsibilities.
A. If the Building or the Premises shall be damaged by fire or other
casualty resulting from the fault of GROSS negligence of Tenant, or the
agents, employees, licensees or invitees of Tenant (except as set forth in
Section 7.05), such damage shall be repaired by and at the expense of Tenant
under the direction and supervision of Landlord (unless Landlord elects to
perform the work at Tenant's sole cost and expense), and Rent shall continue
without abatement.
B. Except for that portion, if any, of Landlord's gross negligence or
willful misconduct not waived by Tenant, Tenant covenants that Landlord shall
not be liable for any damage or liability of any kind or for any injury to or
death of persons or damage to property of Tenant or any other person during
the Term, including consequential loss or damage, from any cause whatsoever
by reason of the construction, use, occupancy or enjoyment of the Premises by
Tenant or any person therein or holding under Tenant, or by or through the
acts or omissions of other tenants of the Building or Landlord. Tenant hereby
agrees,
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as part of the material consideration for this Lease, to indemnify and hold
Landlord harmless from all claims, action, demands, costs and expenses and
liability whatsoever, including reasonable attorneys' fees, on account of any
such real or claimed damage or liability, and from all liens, claims and
demands occurring in, on or at the Premises, or arising out of the
construction, use, occupancy or enjoyment of the Premises and its facilities,
or any repairs or alterations which Tenant may make upon the Premises.
Section 7.03. Tenant's Insurance. Tenant covenants and agrees that from and
after the date of delivery of the Premises from Landlord to Tenant, Tenant
will carry and maintain, at its sole cost and expense, the following types
of insurance, in the amounts specified and in the form hereinafter provided,
as follows:
A. Tenant shall maintain at its sole cost and expense fire and extended
coverage insurance on all of its personal property, including removable trade
fixtures, located in the Premises and on its leasehold improvements and all
additions and improvements made by Tenant in or to the Premises, in an amount
not less than 100% of the full replacement cost thereof.
B. Tenant shall procure and maintain throughout the Term a policy or
policies of insurance, at its sole cost and expense, Insuring Tenant and
Landlord against any and all liability for injury to or death of a person or
persons, occasioned by or arising out of or in connection with the use or
occupancy of the Premises or by the condition of the Premises (including the
contractual liability of Tenant to indemnify Landlord contained herein), the
coverages and limits of such policy or policies to be not less than as set
forth below:
A. Employer's Liability $500,000
B. Comprehensive General $500,000 with respect
Liability to any one occurrence and
Bodily Injury/ $500,000 with respect to the
Property Damage annual policy aggregate.
The policy shall be issued by an insurance carrier with a Best's rating
of B:VII or better, endorsed to include Landlord as an additional insured,
state that the insurance is primary over any other insurance carried by
Landlord, and shall include the following coverages:
a) Premises Operations
b) Independent Contractors
c) Contractual coverage in support of Section 7.02B of this Lease
d) Personal Injury Liability without exclusionary or limiting
endorsements.
Evidence of these coverages represented by Certificates of Insurance
issued by the applicable insurance carrier(s) must be furnished to Landlord
prior to Tenant moving in. Certificates of Insurance shall specify the
additional insured status mentioned above as well as the Waivers of
Subrogation (as set forth in Section 7.05). Landlord will be notified in
writing thirty (30) days prior to cancellation, material change or renewal of
insurance. If Tenant fails to comply with the foregoing requirements relating
to insurance, Landlord may obtain such insurance and Tenant shall pay to
Landlord immediately on demand the premium cost thereof. Notwithstanding
anything to the contrary contained herein, to the extent that the terms of
any mortgage, indenture, deed of trust or other similar instrument regarding
delivery of the proceeds of insurance to Landlord's mortgagee conflicts with
the provisions hereof, the provisions of such mortgage, indenture, deed of
trust or other similar instrument shall govern and shall be superior to the
rights or Tenant hereunder, with no further liability of Landlord or
Landlord's mortgagee with regard thereto.
Section 7.04. Landlord's Insurance. Landlord shall at all times during the
Term maintain in effect a policy or policies of insurance covering the
building (excluding property required to be insured by Tenant) in such
amounts as Landlord may from time to time determine, providing protection
against perils included within the standard Texas form of fire and extended
coverage insurance policy, together with insurance against sprinkler damage,
vandalism and malicious mischief, and such other risks as Landlord may from
time to time determine and with any such deductibles as Landlord may from
time to time determine.
Any insurance provided for in this Section 7.04 may be effected by a policy
or policies of blanket insurance, covering additional items or locations or
assureds, provided that the requirements of this Section are otherwise
satisfied. Tenant shall have no rights in any policy or policies maintained
by Landlord and shall not, by reason of payment by Tenant, as part of the
Building Operating Expenses, of its prorate share of the Landlord's premium
for the insurance, be entitled to be named insured thereunder.
Section 7.05. Waiver of Subrogation. Landlord and Tenant hereby waive any
rights each may have against the other, on account of any loss or damage
occasioned to Landlord or Tenant, as the case may be, their respective
property, the Premises, its contents or to the other portion of the Building
arising from any risk covered (or required hereby to be covered) by insurance
to the extent of proceeds received in connection therewith. Landlord and
Tenant each agree to cause an endorsement to be issued to their respective
insurance policies recognizing this waiver of subrogation.
ARTICLE 8
CONDEMNATION
In the event the Building, or any portion thereof necessary, in the sole
opinion of Landlord, to the continued efficient and/or economically feasible
use of the Building, shall be taken or condemned in whole or in part for
public purposes, or sold to a condemning authority to prevent taking, then
the term of this Lease shall, at the option of the Landlord, forthwith cease
and terminate, and the Landlord shall receive the entire award for land and
buildings; Tenant hereby expressly assigning to Landlord any and all right,
title and interest of Tenant now or hereafter arising in and to any such
award. Tenant shall have the right to recover from such authority, but not
from Landlord, only any compensation as may be awarded to Tenant on account
of moving and relocation expenses.
ARTICLE 9
LIENS
Tenant shall keep the Premises free from any liens arising out of any work
performed, materials furnished, of obligations incurred by or for Tenant. In
the event that Tenant shall not, within fifteen (15) days following the
imposition of any such lien, cause the same to be released of record by
payment or posting of a proper bond, Landlord shall have, in addition to
all other remedies provided herein and by law, the right, but not the
obligation, to cause the same to be released by such means as it shall deem
proper, including payment of or defense against the claim giving rise to such
lien. All sums paid by Landlord and all expenses incurred by it in connection
therewith shall create automatically an obligation of Tenant to pay, on
demand, an equivalent amount together with interest at 12% per annum as Rent.
No work which Landlord permits Tenant to perform in the Premises shall be
deemed to be for the immediate use and benefit of Landlord so that no
mechanics or other lien shall be allowed against the estate of Landlord by
reason of its consent to such work.
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ARTICLE 10
TAXES ON TENANT'S PROPERTY
Tenant shall be liable for and shall pay, prior to their becoming delinquent,
any and all taxes and assessments levied against any personal property or
trade or other fixtures placed by Tenant in or about the Premises, including
any additional real estate taxes or assessments which may be levied against
the Building by reason of Tenant's leasehold improvements.
ARTICLE 11
SUBLETTING AND ASSIGNING
Section 11.01 Responsibilities. Tenant shall not assign this Lease, or allow
it to be assigned, in whole or in part, by operation of law or otherwise
(including without limitation by transfer of stock, merger, dissolution or
change in occupancy), or mortgage or pledge the same, or sublet the Premises,
or any part thereof, without the prior written consent of Landlord (provided,
however, without limiting the generality of the foregoing, no such assignment
or subletting shall be permitted to any other existing tenants of the Building
or any prospects to whom Landlord has sent a written proposal and Tenant shall
not be permitted to advertise the Premises in a printed publication by
Building name or address). In no event shall any such assignment or sublease
ever release Tenant from any obligation or liability hereunder. No assignee or
sublessee of the Premises or any portion thereof may assign or sublet the
Premises or any portion thereof. If Tenant is a corporation or partnership and
if at any time during the Term of this Lease, the person or persons who own a
majority of either the outstanding voting shares or all outstanding shares of
capital stock or interests of or in Tenant at the time of the execution of
this Lease cease to own a majority of such shares or interests (except as a
result of transfers by devise or descent or a bona fide merger of Tenant), the
loss of a majority of such shares or interests shall be deemed an assignment
of this Lease by Tenant and therefore be subject in all respects to the
provisions of Article 11.
Section 11.02. Conditions of Sublease. If the Tenant desires to assign or
sublet all or any part of the Premises, it shall so notify Landlord at least
thirty (30) days in advance of the date on which Tenant desires to make such
assignment or sublease. Tenant shall provide Landlord with a copy of the
proposed assignment or sublease, and such information as Landlord might
request concerning the proposed sublessee or assignee to allow Landlord to
make informed judgments as to the financial condition, reputation, operations
and general desirability of the proposed subtenant(s) or assignee. Within
thirty (30) days after Landlord's receipt of Tenant's proposed assignment or
sublease, and all required information concerning the proposed subtenant(s)
or assignee, Landlord shall have the option to:
A. Cancel the Lease as to the Premises or portion thereof proposed to be
assigned or sublet; or
B. Consent to the proposed assignment or sublease, in which event, however,
if the rent due and payable by any assignee or sublessee under any such
permitted assignment or sublease (or a combination of the rent payable under
such assignment or sublease plus any bonus or any other consideration therefor
or any payment incident thereto) exceeds the Basic Rent and Additional Rent
payable under this Lease for such space, Tenant shall pay to Landlord all such
excess rent and other excess consideration within ten (10) days following
receipt thereof by Tenant less actual costs to sub-lease; or
C. Refuse its consent to the proposed assignment or sublease and such
consent not to be unreasonably withheld but allow Tenant to continue in the
search of an assignee or sublessee that may be acceptable to Landlord, which
option shall be deemed to be elected unless Landlord gives Tenant written
notice providing otherwise.
Consent of Landlord to one or more assignments or sublettings shall not
operate as a waiver of Landlord's rights as to any subsequent assignment or
subletting.
If in accordance with the terms and provisions hereof this Lease is assigned,
or if any of the Premises, or any part thereof, is sublet, or occupied by any
one other than the Tenant, the Landlord may, after default by the Tenant,
collect rent from the assignee, subtenant, or occupant and apply the net
amount collected, exclusive of costs of collection, attorney's fees or other
fees incurred by Landlord, to the Rent herein reserved.
ARTICLE 12
TRANSFERS BY LANDLORD
Section 12.01. Sale of the Building. In the event of a sale or conveyance by
Landlord of the Building, the same shall operate to release Landlord from any
and all liability under this Lease arising after the date of such sale.
Tenant's right to the quiet possession of the Premises shall not be disturbed
so long as Tenant shall pay the Rent and observe and perform all of the
provisions of this Lease to be observed and performed by Tenant, unless this
Lease is terminated pursuant to specific provisions relating thereto or
contained herein. If any security deposit has been made by Tenant, Landlord
shall transfer such security deposit to the purchaser, and thereupon Landlord
shall be discharged from any further liability in reference thereto.
Section 12.02. Subordination And Attornment.
A. This Lease is subject and subordinate to any lease wherein Landlord is
the tenant and to the lien of any and all mortgages or deeds of trust,
regardless of whether such lease, mortgages or deeds of trust now exist or
may hereafter be created with regard to all or any part of the Building, and
to any and all advances to be made thereunder, and to the interest thereon,
and all modifications, consolidations, renewals, replacements and extensions
thereof. Tenant also agrees that any lessor, mortgagee or trustee may elect
to have this Lease prior to any lease or lien of its mortgage or deed of
trust, and in the event of such election and upon notification by such
lessor, mortgagee or trustee to Tenant to that effect, this Lease shall be
deemed prior to the said lease, mortgage or deed of trust, whether this Lease
is dated prior to or subsequent to the date of said Lease, mortgage or trust
deed.
B. Tenant shall, in the event of the sale or assignment of Landlord's
interest in the Premises (except in a sale-leaseback financing transaction),
or in the event of the termination of any lease in a sale leaseback
transaction wherein Landlord is the lessee, attorn to and recognize such
purchaser or assignee or mortgagee as Landlord under this Lease.
C. Tenant shall, in the event of any proceedings brought for the
foreclosure of, or in the event of the exercise of the power of sale under,
any mortgage or deed of trust covering the Premises, attorn to and recognize
such purchaser or assignee or mortgagee as Landlord under this Lease.
D. Simultaneously with delivery of any notice of default to Landlord,
Tenant shall deliver to any existing or future Landlord's mortgagee(s) a copy
of such notice of default from Tenant to Landlord (provided that Tenant shall
have been notified
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of such mortgagee's address), and such mortgagee(s) shall have the right, but
not the obligation, to cure all defaults of Landlord within the same time
period provided in this Lease for curing such defaults by Landlord, plus an
additional period of thirty (30) days. Tenant shall not be entitled to
exercise any of its remedies hereunder as a result of any such default by
Landlord unless and until such notice shall have been given to such
mortgagee(s) and the requisite time period for curing such default by
Landlord's mortgagee shall have expired and such default shall not have been
cured. Unless the prior written consent of Landlord's mortgagee(s) is
obtained, none of the following shall be effective as to any such Landlord's
mortgagee(s):
(a) any amendment or modification to this Lease;
(b) any surrender of this Lease, or any termination of
this Lease except pursuant to a right to terminate expressly set
forth herein; or
(c) payment of any Rent for more than one month in
advance or payment of any Rent other than in strict accordance
with the terms of this Lease.
E. The above subordination and attornment and mortgagee protection
clauses shall be self-operative and no further instruments of subordination
or attornment or mortgagee protection need be required by any mortgagee,
trustee, lessor, purchaser or assignee. In confirmation thereof, Tenant
agrees that, upon the request of Landlord, or any such lessor, mortgagee,
trustee, purchaser or assignee, Tenant shall execute and deliver whatever
instruments may be required for such purposes and to carry out the intent of
this Section, and in the event Tenant fails to do so within ten (10) days
after demand in writing, Tenant does hereby make, constitute and irrevocably
appoint Landlord as its attorney-in-fact, complete with an interest, in its
name, place and stead so to sign and deliver such instruments as if the same
had been signed and delivered by Tenant.
ARTICLE 13
DEFAULT
Section 13.01. Defaults by Tenant. The occurrence of any of the following
shall constitute a material default and breach of this Lease by Tenant:
A. Any failure by Tenant to pay Rent or to make any other payment
required to be made by Tenant hereunder when due. No notice is required for
any monetary default;
B. Any failure by Tenant to observe and perform any other provision of
this Lease to be observed or performed by Tenant, where such failure
continues for twenty (20) days after written notice to Tenant;
C. Tenant admits in writing that it cannot meet its obligations as they
become due; or is declared insolvent according to any law; or assignment of
Tenant's property is made for the benefit of creditors; or a receiver or
trustee is appointed for Tenant or its property; or the interest of Tenant
under this Lease is levied on under execution or other legal process; or any
petition is filed by or against Tenant to declare Tenant bankrupt or to
delay, reduce or modify Tenant's debts or obligations; or any petition is
filed or other action taken to reorganize or modify Tenant's capital
structure if Tenant be a corporation or other entity (provided that no such
levy, execution, legal process or petition filed against Tenant shall
constitute a breach of this Lease if Tenant shall vigorously contest the same
by appropriate proceedings and shall remove or vacate the same within thirty
(30) days from the date of its creation, service or filing).
D. The abandonment or vacation of the Premises by Tenant, which shall
mean that Tenant is absent from the Premises for sixty (60) consecutive days
coupled with the failure to pay Base Rent or Additional Rent.
E. Tenant assigns this Lease or subleases all or any part of the
Premises in violation of the provisions of Article 11.
Section 13.02. Remedies of Landlord. In the event of any such default by
Tenant, Landlord, at its option, may have one or more of the following
remedies, in addition to all other rights and remedies provided at law or in
equity:
A. Landlord may terminate this Lease and without further notice
repossess the Premises and be entitled to recover as damages a sum of money
equal to the total of (1) the cost of recovering the Premises, (2) the
unpaid Rent earned at the time of termination, plus interest thereon, (3)
the balance of the Rent for the remainder of the term, (4) reasonable costs
of reletting and refurbishing, and (5) any other sum of money and damages
owed by Tenant to Landlord; or
B. Landlord may immediately terminate Tenant's right of possession of
the Premises, but not terminate the Lease, and without notice or demand enter
upon the Premises or any part thereof and take absolute possession of the
same, change the locks, and, at Landlord's option, Landlord may relet the
Premises or any part thereof for such terms and such rents as Landlord may
reasonably elect. In the event Landlord shall elect to so relet, then Rent
received by Landlord from such reletting shall be applied first, to the
payment of any indebtedness other than Rent due hereunder from Tenant to
Landlord, second, to the payment of any cost of such reletting, including,
without limitation, refurbishing costs and leasing commissions, and third, to
the payment of Rent due and unpaid hereunder, and Tenant shall satisfy and
pay any deficiency upon demand therefor from time to time.
Any entry into and possession of the Premises by Landlord under this Article
shall be without liability or responsibility to Tenant and shall not be in
lieu of or in substitution for any other rights of Landlord hereunder or in
law or in equity. Tenant further agrees that Landlord may file suit to
recover any sums due under the terms of this Article and that no recovery of
any portion due Landlord hereunder shall be any defense to any subsequent
action brought for any amount not theretofore reduced to judgment in favor of
Landlord. Reletting of the Premises shall not be construed as an election on
the part of Landlord to terminate this Lease and, notwithstanding any such
reletting without termination, Landlord may at any time thereafter elect to
terminate this Lease for such previous breach.
Section 13.03. Landlord's Lien. Landlord shall have all the rights and
remedies of a secured party under the laws of the State of Texas, including
the Texas Business and Commerce Code, and such lien and security interest may
be foreclosed with or without court proceedings, by public or private sale.
Within five (5) days after request therefor, Tenant agrees to execute and
deliver to Landlord such financing statements, continuation statements and
other instruments as may be requested by Landlord to evidence and perfect the
lien and security interest herein granted.
Section 13.04. Defaults by Landlord. Except as otherwise provided in this
Lease, Landlord shall be in default under this Lease if Landlord fails to
perform any of these obligations hereunder and said failure continues for
a period of thirty (30) days after written notice thereof from Tenant to
Landlord (unless such failure cannot reasonably be cured within thirty (30)
days and Landlord shall have commenced to cure said failure within said
thirty (30) days and continues diligently to pursue the curing of the same.)
If Landlord shall be in default under this Lease and, if as a consequence of
such default, Tenant shall recover a money judgment against Landlord, such
judgment shall be satisfied only out of the right, title and interest of
Landlord in the Building as the same may then be encumbered, and Landlord
shall not be liable for any deficiency. In no event shall Tenant have the
right to levy execution against any property of Landlord other than its
interest in the Building as herein before expressly provided. Tenant, to
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the fullest extent permitted by applicable law, hereby expressly waives any
right to claim a statutory lien in favor of Tenant pursuant to Section 91.004
of the Texas Property Code in the event of Landlord's breach of this Lease.
ARTICLE 14
NOTICES
All notices which Landlord or Tenant may be required, or may desire, to serve
on the other shall be in writing and may be served, as an alternative to
personal service, by depositing the same with the U.S. Postal Service, by
registered or certified mail, postage prepaid, addressed as follows: (i) to
Landlord at the address set forth in Item 10 of the Basic Lease Provisions;
(ii) prior to the Commencement Date of this Lease, to Tenant at the address
set forth in Item 9 of the Basic Lease Provisions; and (iii) after the
Commencement date, to Tenant at the Premises. Any notices by mail as
aforesaid shall be deemed delivered, served and given two (2) business days
after deposit of the same with the postal authority. The addresses stated
above shall be effective for all notices to the respective parties until
written notice of a change of address is given pursuant to provisions hereof.
ARTICLE 15
MISCELLANEOUS PROVISIONS
Section 15.01. Estoppel Certificate. Tenant shall, upon the written request of
Landlord or any mortgagee of Landlord, without additional consideration,
deliver an Estoppel Certificate within five (5) business days, consisting of
statements, if true, that:
A. This Lease is in full force and effect, with rental paid through
__________________.
B. This Lease has not been modified or amended; and
C. Landlord is not in default and Landlord has fully performed all of
Landlord's obligations hereunder, and any such further consents and
instruments of a similar nature evidencing the agreement of Tenant to the
mortgage or other hypothecation by Landlord of the reversionary interest of
Landlord hereunder as may be reasonably requested by Landlord or any
mortgagee of Landlord.
Section 15.02. Relocation. In the event Landlord determines to utilize the
Premises for other purpose, during the term of this Lease, Tenant agrees to
relocate to other space in the Building provided such other space is of equal
or larger size than the Premises and has at least the same number of windows.
Landlord shall pay all out-of-pocket expenses of any such relocation,
including the expenses of moving and reconstruction of all Tenant furnished
and Landlord furnished improvements. In the event of such relocation, this
Lease shall continue in full force and effect without any change in the terms
or other conditions, but with the new location substituted for the old
location set forth in Item 2 to the Basic Lease Provisions and on "Exhibit
A-1".
Section 15.03. Attorney's Fees. In the event or any legal action or
proceeding brought by either party against the other arising out of this
Lease, the prevailing party shall be entitled to recover reasonable
attorney's fees and costs incurred in such action and such amount shall be
included in any judgment rendered in such proceeding.
Section 15.04. Waiver. No waiver by Landlord or any provision of this Lease
or of any breach by Tenant hereunder shall be deemed to be a waiver of any
other provision hereof, or of any subsequent breach by Tenant of the same or
any other provision. Landlord's consent to or approval of any act by Tenant
requiring Landlord's consent or approval shall not be deemed to render
unnecessary the obtaining of Landlord's consent to or approval of any
subsequent act of Tenant. No act or thing done by Landlord or Landlord's
agents during the term of this Lease shall be deemed an acceptance of a
surrender of the Premises, unless done in writing signed by Landlord. The
delivery of the keys to any employee or agent of Landlord shall not operate
as a termination of the Lease or a surrender of the Premises. The acceptance
of any Rent by Landlord following a breach of this Lease by Tenant shall not
constitute a waiver by Landlord of such breach or any other breach unless
such waiver is expressly stated in writing signed by Landlord.
Section 15.05. Insolvency or Bankruptcy. In no event shall this Lease be
assigned or assignable by operation of law and in no event shall this Lease
be an asset of Tenant in any receivership, bankruptcy, insolvency or
reorganization proceeding.
Section 15.06. Applicable Law. This Lease shall be governed by and construed
pursuant to the laws of the State of Texas.
Section 15.07. Common Facilities; Parking. Tenant shall have the
non-exclusive right, in common with others, to the use of common entrances,
lobbies, elevators, ramps, drives, stairs and similar access and service ways
and other common facilities in and adjacent to the Building, subject to such
rules and regulations as may be adopted by the Landlord. Tenant shall have
such parking rights as are set forth in the Parking Agreement attached hereto
as "Exhibit F".
Section 15.08. Successors and Assigns. Except as otherwise provided in this
Lease, all of the covenants, conditions and provisions of this Lease shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective heirs, personal representatives, successors and assigns.
Section 15.09. Brokers. Tenant warrants that it has had no dealings with any
real estate broker or agent in connection with the negotiation of this
Lease, excepting only the broker(s) named in Item 8 of the Basic Lease
Provisions, and that it knows of no other real estate broker(s) or agent(s)
who is (are) or might be entitled to a commission in connection with this
Lease. Landlord covenants and agrees to pay all real estate commissions due
in connection with this Lease to only such broker(s) named in Item 8 of the
Basic Lease Provisions, and Tenant agrees to indemnify and hold harmless
Landlord from and against any liability or claim, whether meritorious or not,
arising in respect to broker(s) not so named.
Section 15.10. Severability. If any provision of this Lease or the
application thereof to any person or circumstances shall be invalid or
unenforceable to any extent, the remainder of this Lease and the application
of such provisions to other persons or circumstances shall not be affected
thereby and shall be enforced to the greatest extent permitted by law.
Section 15.11. Name. Tenant shall not, without the written consent of
Landlord, use the name of the Building for any purpose other than as the
address of the business to be conducted by Tenant in the Premises, and in no
event shall Tenant acquire any rights in or to such name.
Section 15.12. Examination of Lease. Submission of this instrument for
examination or signature by Tenant does not constitute a reservation of or
option for lease, and it is not effective as a lease or otherwise until
execution by and delivery to both Landlord and Tenant.
Section 15.13. Interest on Tenant's Obligations. Any amount due from Tenant to
Landlord which is not paid when due shall bear interest at twelve percent
(12%) per annum from the date such payment is due until paid, but the payment
of such interest shall not excuse or cure the default.
Section 15.14. Time. Time is of the essence in this Lease and in each and all
of the provisions hereof.
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Section 15.15. Defined Terms and Marginal Headings. The words "Landlord" and
"Tenant" as used herein shall include the plural as well as singular. If more
than one person is named as Tenant, the obligations of such persons are joint
and several. The headings and titles to the articles of this Lease are not a
part of this Lease and shall have no effect upon the construction or
interpretation of any part hereof.
Section 15.16. Authority. If Tenant executes this Lease as a corporation,
each of the persons executing this Lease on behalf of Tenant does hereby
personally covenant and warrant that Tenant is a duly authorized and existing
corporation, that Tenant has and is qualified to do business in Texas, that
the corporation has full right and authority to enter into this Lease, and
that each person signing on behalf of the corporation was authorized to do
so. If Tenant executes this Lease as a partnership or other entity, each of
the persons executing this Lease on behalf of Tenant does hereby personally
covenant and warrant that, to the extent required by law, Tenant has and is
qualified to do business in Texas, that such entity has full right and
authority to enter into this Lease, and that each person signing on behalf of
such entity has authority to do so. Upon request of Landlord, the signatories
hereto will furnish satisfactory evidence of their authority to execute this
Lease on behalf of Tenant.
Section 15.17. Recording. This lease shall not be recorded. However, Landlord
shall have the right to record a short form or memorandum thereof, at
Landlord's expense, at any time during the term hereof, and Tenant agrees to
join in the execution thereof if requested.
Section 15.18. Financial Statements. Tenant shall furnish to Landlord from
time to time (but not more frequently than ONCE in any consecutive 365 day
period) a statement of the financial condition of Tenant in a form reasonably
satisfactory to landlord.
Section 15.19. Entire Agreement. This Lease contains all of the agreements of
the parties hereto with respect to any matter covered or mentioned in this
Lease, and no prior agreement, understanding or representation pertaining to
any such matter shall be effective for any purpose. No provision of this
Lease may be amended or added to except by an agreement in writing signed by
the parties hereto or their respective successors in interest.
IN WITNESS WHEREOF, the parties hereto have executed this Lease.
TENANT:
Air Nexus, Inc.
By: /s/ Xxxxxxx X. Xxxxxx Xx.
-----------------------------------------
Name: Xxxxxxx X. Xxxxxx Xx.
--------------------------------
Title: CEO
--------------------------------
LANDLORD:
Harvard Property (333 Xxx Houston), L.P.
By: /s/ Xxxxxx Xxxxxxxxx
-----------------------------------------
Name: Xxxxxx Xxxxxxxxx
--------------------------------
Title: President/CEO
--------------------------------
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CONTINUING LEASE GUARANTY
In consideration of the making of the foregoing Lease Agreement ("Lease"), and
for the purpose of inducing Landlord to enter into and make this Lease, the
undersigned hereby unconditionally guarantees the full and prompt payment of
rent and all other sums required to be paid by Tenant under the Lease
("Guaranteed Payments") and the full and faithful performance of all terms,
conditions, covenants, and obligations (collectively, the "Guaranteed
Obligations") and undersigned further promises to pay all of Landlord's costs
and expenses (including reasonable attorney's fees) incurred in endeavoring
to collect the Guaranteed Payments or to enforce the Guaranteed Obligations
or incurred in enforcing this guaranty as well as all damages which Landlord
may suffer in consequence of any default or breach under the Lease or this
guaranty.
1. Landlord may at any time and from time to time, without notice to or
consent by the undersigned, take any or all of the foregoing actions without
affecting or impairing the liability and obligations of the undersigned on
this Guaranty:
(a) grant an extension or extensions of time or payment of any
Guaranteed Payment or time for performance of any Guaranteed
Obligation;
(b) grant an indulgence or indulgences in any Guaranteed Payment or
in the performance of any Guaranteed Obligation;
(c) modify or amend the Lease or any term thereof, or any obligation
of Tenant arising thereunder;
(d) consent to any assignment or assignments, sublease or subleases
and successive assignments of subleases by Tenant;
(e) consent to an extension or extensions of the term of the Lease;
(f) accept other guarantors; and or
(g) release any person primarily or secondarily liable.
The liability of the undersigned under this guaranty shall not be affected or
impaired by any failure or delay by Landlord in enforcing any Guaranteed
Payment or Guaranteed Obligation or this guaranty or any security therefor or
in exercising any right or power in respect thereto, or by any compromise,
waiver, settlement, charge, subordination, modification or disposition of any
Guaranteed Payment or Guaranteed Obligation or any security therefor. In
order to hold the undersigned liable hereunder, there shall be no obligation
on the part of Landlord, at any time, to resort for payment to Tenant or to
any other guaranty irrespective of whether or not other proceedings or
actions are pending or being taken seeking resort to or realization upon or
from any of the foregoing. The undersigned's liability hereunder shall
continue notwithstanding the insolvency or bankruptcy of Tenant. The
obligations of the undersigned hereunder shall continue in full force and
effect, notwithstanding the invalidity or insufficiency or other defect or
impairment of the guaranteed Lease and the undersigned will not assert by way
of setoff, counterclaim, recoupment or otherwise any claim, indebtedness or
liability owing or claimed to be owing or to him from Tenant or from any
other person, firm or corporation, and the undersigned will not assert as a
defense to any payment or other obligation owing by him under this Guaranty
any defense he may have or claim to have against Tenant or against any other
person, firm or corporation.
2. The undersigned waives all diligence in collection or in protection of
any security, presentment, protest, demand, notice of dishonor or default,
notice of acceptance of this Guaranty, notice of any extensions granted or
other action taken in reliance hereon and all demands and notices of any kind
in connection with this Guaranty or any Guaranteed Payment or Guaranteed
Obligation.
3. The undersigned hereby acknowledges full and complete notice and
knowledge of all the terms, conditions, covenants, obligations and agreements
of the Lease.
4. The payment by the undersigned of any amount pursuant to this Guaranty
shall not in any way entitle the undersigned to any right, title or interest
(whether by subrogation or otherwise) of the Tenant under the Lease or to any
security being held for any Guaranteed Payment or Guaranteed Obligation.
5. This Guaranty shall be continuing, absolute and unconditional and remain
in full force and effect until all Guaranteed Payments are made, all
Guaranteed Obligations are performed, and all obligations or the undersigned
under this guaranty are fulfilled.
6. This Guaranty also shall bind the heirs, personal representatives and
assignees of the undersigned and shall inure to the benefit of Landlord, its
successors and assigns.
7. This Guaranty shall be construed according to the laws of the State of
Texas.
8. If this Guaranty is executed by more than one person, all singular nouns
and verbs herein relating to the undersigned shall include the plural number,
the obligations of the several guarantors shall be joint and several, and
Landlord may enforce this Guaranty against any one or more guarantors without
xxxxxx of any other guarantor hereunder.
9. The Landlord and the undersigned intend and believe that each provision
of the Guaranty comports with all applicable law. However, if any provision
of this Guaranty is found by a court to be invalid for any reason, the
remainder of the Guaranty shall continue in full force and effect and the
invalid provision shall be construed as if it were not contained herein.
IN WITNESS WHEREOF, the undersigned has executed this Guaranty this
_________________ day of ____________________,19___.
GUARANTOR
----------------------------------
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EXHIBIT "A-2"
STANDARD FORM OFFICE LEASE AGREEMENT
PROPERTY DESCRIPTION
LEGAL DESCRIPTION
A tract of land containing 4.2700 acres, more or less, located in the Xxxxxxx
Xxxxx Xxxxxx, Xxxxxxxx Xx. 000, Xxxxxx Xxxxxx, Xxxxx.
EXHIBIT B
AREA DEFINITIONS
NET RENTABLE AREA. For all purposes of the Lease, "Net Rentable Area"
shall be the sum of:
1. As to a multi-tenant floor, (a) the area encompassed by the inside
surface of all exterior walls of the office building, the corridor side of
corridor walls and the center line of walls and the center line of walls
separating the Premises from other leased or leasable areas, (b) a prorated
share of all common areas on the same floor as the Premises (including
elevator lobby, corridors, restrooms, mechanical and electrical rooms, and
telephone rooms and janitor closets), and (c) the area set forth in 3. below.
2. As to a single-tenant floor, (a) the area encompassed by the inside
surface of all exterior walls of the office building, less only stairs,
vertical shafts, mechanical and electrical rooms, telephone rooms, janitor
closets, and such other rooms not actually available for the tenant's use
(restrooms, corridors and elevator lobbies serving such a floor shall be
included), (b) all common area on such floor (including mechanical and
electrical rooms, telephone rooms and janitor closets), and (c) the area set
forth in 3. below.
3. As to a multi-tenant floor and a single-tenant floor, a prorated
share of other office building common areas (including court level and plaza
level entrance lobbies, shipping and receiving room, fire department room,
post office, building storage area, service elevator lobbies, exit corridors
and elevator machine rooms for building elevators).
Net Rentable Area shown in the Basic Lease Provisions has been
calculated on the basis of the foregoing definition and is hereby agreed to
be the stated area regardless of minor variations resulting from actual
construction and completion of the Premises for occupancy.
-1-
EXHIBIT "C"
ACCEPTANCE OF PREMISES MEMORANDUM
This Memorandum is an amendment to the Lease for space in 000 X. Xxx Xxxxxxx
Xxxxxxx X., Xxxxx 000, dated on the 12th day of July, 1998, between Harvard
Property (333 Xxx Houston), as Landlord, and Air Nexus, Inc. as Tenant.
Landlord and Tenant hereby agree that:
1. Except for those items shown on the attached "punch list", Landlord
has fully completed the construction work required of Landlord under the
terms of the Lease and the Agreement for Construction attached thereto.
2. The Premises are tenantable, the Landlord has no further obligation
for construction (except as specified above), and Tenant acknowledges that
the Premises are satisfactory in all respects.
3. The Commencement Date of the Lease is hereby agreed to be the 1st
day of October, 1999.
4. The Expiration Date of the Lease is hereby agreed to be on the 31st
day of September, 2004.
All other terms and conditions of the Lease are hereby ratified and acknowledged
to be unchanged.
Agreed and Executed this _____ day of ___________, 19__.
TENANT:
Air Nexus, Inc.
By: /s/ XXXXXXX X. XXXXXX, XX.
----------------------------------
Name: Xxxxxxx X. Xxxxxx, Xx.
-----------------------------
Title: CEO
---------------------------
LANDLORD:
Harvard Property (333 Xxx Houston) L.P.
By: /s/ XXXXXX XXXXXXXXX
----------------------------------
Name: Xxxxxx Xxxxxxxxx
-----------------------------
Title: President/CEO
---------------------------
-1-
EXHIBIT "D"
AGREEMENT FOR CONSTRUCTION
1. Landlord, at Landlord's expense agrees to a Buildout Allowance not
to exceed $32,952.00 calculated at a rate of $8.00 per rentable square foot.
The Buildout Allowance is to be used for improvements to the Premises only.
-1-
EXHIBIT "E"
STANDARD FORM OFFICE LEASE AGREEMENT
RULES AND REGULATIONS
1. No sign, placard, picture, advertisement, name or notice shall
be inscribed, displayed or printed or affixed on or to any part of the
outside, or inside of the Building without the written consent of Landlord
first had and obtained and Landlord shall have the right to remove any such
sign, placard, picture, advertisement, name or notice without notice to and
at the expense of Tenant.
Tenant shall not place anything or allow anything to be placed
near the glass of any window, door, partition or wall which may appear
unsightly from outside the Premises; provided, however, that Tenant may
furnish and install a Building standard window covering at all exterior
windows. Tenant shall not without the prior written consent of Landlord
sunscreen any window.
Tenant shall cooperate with Landlord in obtaining maximum
effectiveness of the cooling system by closing blinds when the sun's rays
fall directly on windows of the Premises. Tenant shall not obstruct, alter or
in any way impair the efficient operation of Landlord's heating, lighting,
ventilating and air conditioning system and shall not place bottles, machines,
parcels or any other articles on the induction unit enclosure so as to
interfere with air flow. Tenant shall not tamper with or change the setting
of any thermostats or temperature control valves.
2. The sidewalks, halls, passages, exits, entrances, elevators and
stairways shall not be obstructed by Tenant or used by Tenant for any purpose
other than for ingress and egress to and from the Premises.
3. Tenant shall not alter any lock or install any new or additional
locks or any bolts on any doors or windows of the Premises.
Tenant agrees to make a reasonable deposit, in an amount fixed
by Landlord from time to time, for each key issued by Landlord to Tenant for
its offices, and upon termination of this Lease, to return all keys to Landlord.
4. The toilet rooms, urinals, wash bowls and other apparatus
shall not be used for any purpose other than that for which they were
constructed and no foreign substance of any kind, including sweepings,
rubbish, rags, food and coffee grounds, whatsoever shall be thrown therein
and the expense of any breakage, stoppage or damage resulting from the
violation of this rule shall be borne by the Tenant who, or whose employees
or invitees, shall have caused it.
5. Tenant shall not overload the floor of the Premises or in any
way deface the Premises or any part thereof.
6. No furniture, freight or equipment of any kind shall be brought
into the Building without prior written notice to Landlord and all moving of
the same into or out of the Building shall be done at such time and in such
manner as Landlord shall designate. Landlord shall have the right to
prescribe the weight, size and position of all safes and other heavy
equipment brought into the Building and also the times and manner of moving
the same in and out of the Building. Safes or other heavy objects shall, if
considered necessary by Landlord, stand on supports of such thickness as is
necessary to properly distribute the weight. Landlord will not be responsible
for loss of or damage to any such safe or property from any cause and all
damage done to the Building by moving or maintaining any such safe or other
property shall be repaired at the sole cost and expense of Tenant.
7. Tenant shall not use, keep or permit to be used or kept any
foul or noxious gas or substance in the Premises, or permit or suffer the
Premises to be occupied or used in a manner offensive or objectionable to the
Landlord or other occupants of the Building by reason of noise, odors and/or
having business therein, nor shall any animals or birds be brought in or kept
in or about the Premises or the Building.
8. It is agreed and understood that the authorized use of the
Premises is for general office occupancy and no cooking shall be done or
permitted by any Tenant on the Premises, nor shall the Premises be used for
the storage of merchandise, for washing clothes, for lodging, or for
improper, objectionable or immoral purposes. All coffee makers shall be
plugged into timers for automatic shutoff after business hours. The use of
space heaters is strictly prohibited.
9. Tenant shall not use or keep in the Premises or the Building
any kerosene, gasoline or flammable or combustible fluid or material, or use
any method of heating or air conditioning other than that supplied by Landlord.
10. Landlord will direct electricians as to where and how telephone
and telegraph wires are to be introduced. No boring or cutting for wires will
be allowed without the prior written consent of the Landlord. The location of
telephones, call boxes and other office equipment affixed to the Premises
shall be subject to the prior written approval of landlord. Tenant shall not
xxxx, paint, drill into or in any way deface any part of the Premises or the
Building.
11. On Saturdays, Sundays and legal holidays, and on other days
between the hours of 6:00 P.M. and 8:00 A.M. the following day, access to the
Building, or to the hall, corridors, elevators or stairways in the Building,
or to the Premises may be refused unless the person seeking access is known
to the person or employee of the Building in charge and has a pass or is
otherwise properly identified. Landlord shall in no case be liable for
damages for any error with regard to admission to or exclusion from the
Building of any person. In case of invasion, mob, riot, public excitement, or
other commotion, Landlord reserves the right to prevent access to the
Building during the continuance of the same by closing of the doors or
otherwise, for the safety of the tenants and protection of property in the
Building and the Building.
12. Landlord reserves the right to exclude or expel from the
Building any person who, in the judgment of Landlord, is intoxicated or under
the influence of liquor or drugs, or who shall in any manner do any act in
violation of any of the rules and regulations of the Building.
13. No vending machines or machines of any description shall be
installed, maintained or operated upon the Premises without the prior written
consent of the Landlord (which consent shall not be unreasonably withheld or
delayed).
14. Landlord shall have the right, exercisable without notice and
without liability to Tenant, to change the name and street address of the
Building of which the Premises are a part.
15. Tenant shall not disturb, solicit, or canvass any occupant of
the Building and shall cooperate to prevent same.
16. Without the written consent of Landlord, Tenant shall not use
the name of the Building in connection with or in promoting or advertising
the business of Tenant except as Tenant's address.
17. Landlord shall have the right to control and operate the public
portions of the Building, and the public facilities, and heating and air
conditioning, as well as facilities furnished for the common use of the
tenants, in such manner as it deems best for the benefit of the tenants
generally.
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TEXAS FORM 58A
EXHIBIT "E"
18. All entrance doors in the Premises shall be left locked when
the Premises are not in use, and all doors opening to public corridors shall
be kept closed except for normal ingress and egress to and from the Premises.
19. Landlord shall have the right to prohibit any advertising by
Tenant which, in Lessor's sole judgment, discretion and opinion, tends to
impair the reputation of the Building or its desirability as an office
building, and upon receipt of prior written notice from Landlord, Tenant
shall refrain from or discontinue such advertising.
20. Landlord shall not be responsible for personal property lost or
stolen from the Premises or any public area in the Building regardless of
whether such area is locked or not.
21. Landlord reserves the absolute right to rescind or modify any
or all of these Rules and Regulations, and to promulgate such other and
additional Rules and Regulations as it shall deem necessary or desirable.
Upon receipt of a written copy of new or modified Rules and Regulations from
Landlord, Tenant shall be thereafter bound as if said Rules and Regulations
had been originally included herein.
-2-
TEXAS FORM 58A
EXHIBIT "E"
